New Ofgem rules to cut energy bills ‘backfire’

New Ofgem rules intended to cut energy bills will leave some SSE customers out of pocket as the supplier plans to scrap its cheaper tariffs, it has been revealed. Regulations […]

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By ELN reporter

New Ofgem rules intended to cut energy bills will leave some SSE customers out of pocket as the supplier plans to scrap its cheaper tariffs, it has been revealed.

Regulations imposed by Ofgem’s Retail Market Review limit energy suppliers to offering four different tariffs and were meant to reduce bills by forcing suppliers to put customers on their cheapest rate.

This all came about after Prime Minister David Cameron blundered into the issue with much-derided comments in the House of Commons last year.

Now electricity supplier SSE has told 175,000 household customers they will be moved to new tariffs in order to comply with the new rules. Some customers of Atlantic, one of SSE’s retail brands, will be moved to tariffs up to £100 more expensive.

In a statement SSE said today: “The impact of all the forthcoming regulatory change will affect customers differently, some will be better off and unfortunately others will be worse off.”

Labour today slammed the changes for “backfiring”, worrying that many suppliers will simply ditch their cheaper tariffs.

Shadow energy secretary Caroline Flint said: “This is yet more evidence that David Cameron’s cack-handed reforms to energy tariffs have completely backfired.

“He promised to force the energy companies to put everyone on the cheapest tariffs – but now it looks like thousands of people will be paying more than they were before.”

A DECC spokesman said: “Overall these reforms will lead to a fairer and more efficient energy market. They will simplify tariffs and cut confusion and provide clearer information to help people compare and switch.”